Here’s How to Get Started
As your business grows, so do your needs. As a result, you may find that your data requirements and network demands increase with each acquisition. The challenge is that you want to keep up with this growth but also be efficient as possible with your spending.
Amazon Web Services is a cloud computing giant. It has been a staple of cloud computing since its inception in 2006, offering elastic capacity and pricing based on demand. You’ll have no trouble finding the right fit for your business with a masterful range of services available.
But hold on, that doesn’t mean you have to pay through the nose. With AWS operational costs skyrocketing, it is no surprise that some users find it difficult to control their expenditures. How can you reduce operational costs?
In this article, we’ll explain how you can reduce AWS costs by analyzing and tracking the significant factors behind them using a flexible approach.
AWS offers a wide range of services, from computing power to storage and analytics. Yet it can be challenging for organizations to understand how much each service costs or which pricing model best fits their needs. This is perhaps the main reason they face an issue cutting down on the costs.
Before we dive right in, let us tell you that Amazon Web Services’ operational costs can be dramatically reduced if you have the right tools. The key, however, is one must know when to cut down the cost.
The first step is to measure your expenses and monitor workload, instances, and performance to know where you are spending money. Once you have done that, you can find ways to reduce your operational costs.
Why AWS cloud?
Let’s quickly go through the below table to understand why the AWS cloud is essential for your business.
|Why AWS Cloud?|
|User Friendly||AWS cloud allows all types of applications to run. Whether you build a small site with a few customers and update it weekly or install large enterprise-level applications that rely on reliable availability, AWS starts at the same low prices for you and scales dynamically based on your needs.|
|Dependable||With AWS cloud, you can build mission-critical applications and infrastructure globally. You can choose where to host your data, run your business, and conduct operations in AWS’s region-based data centers across the globe. You get secure, highly available infrastructure supporting millions of users and thousands of transactions per second. Additionally, you have access to other services like storage, databases, monitoring, and security.|
|Protected||AWS takes a collaborative and inventive approach to secure the user’s infrastructure, offering more than just technical controls. AWS Security Center is an interactive guide to helping the users understand how this technology works and walk through the steps required for crucial security measures.|
|Scalability||With dedicated infrastructure and unique setups, Amazon Web Services provides the flexibility, resources, and reliability you need to scale as your business grows.|
When to consider cutting down costs on Amazon Web Services?
Amazon Web Services cost optimization is an essential skill for any SaaS business.
According to our experts, the most common Amazon Web Services cost optimization mistake is not spending enough time understanding the business’s data flow and working flows. For example, the AWS Cost Explorer is a handy tool for identifying unnecessary costs. It allows you to see all technical usage metrics, including the price you pay for each service and how much you use them.
Even when you are working within your budget, AWS costs can escalate. You might also be surprised to learn that $14.1 billion is wasted yearly on unnecessary Amazon Web Services expenses.
This section provides an overview of the AWS pricing structure and how it impacts your bill. While an AWS account may seem complicated, several tools are available to help you understand the costs associated with usage.
To begin with, the Cloud Economics team can provide a detailed, holistic analysis of your environment and identify cost optimization and improvement areas. If you haven’t taken advantage of them, we suggest you make it a priority.
As a discipline, they seek to provide quantitative answers to tough questions for businesses: What is the return on investment (ROI) of migrating to the cloud? How much does it cost? What are its benefits? Is it worthwhile to switch providers?
The Cloud Economics team goes one step further by providing direct value by helping customers find the best cloud infrastructure for their needs. They do this by predicting the value of migrating to the best cloud provider based on customer feedback, historical performance, and KPI analysis. The result is a world-class migration process with maximum savings and guaranteed efficiency benefits.
But the catch is that CIOs, IT managers, and C-level executives must think about the cost of cloud computing on an ongoing basis.
They need to understand the revenue and margin drivers and what drives their spending in the cloud. They also need to know how to increase the return on investment or scale service quality if required. Most importantly, they must deeply set their strategy and targets before beginning their work in this area.
Let’s move on to the real question now. Are you ready? Read on.
Reducing costs for Amazon Web Services
In this blog, we will share with you 5 tips on how to control your AWS costs.
1. Create Transparency
Too often, we tighten our belts, work harder and push more to keep up with the costs of Amazon Web Services. Constantly companies are looking at AWS costs on an ongoing basis. But they are missing one critical element, i.e., teams who can effectively understand and provide insights into the cloud can eventually also cut down on the costs.
Our experts at MindRind have had the privilege of working with many organizations to help them improve their process for collecting and reporting cloud costs. And we can tell you from experience that once you understand how to collect and analyze your AWS data, you will become more aware of what is happening with your overall cloud strategies.
These strategies often include strategic changes related to resource costs.
You need to be able to proactively dive deep into the data and go beyond the surface analysis that the monthly bills provide.
There are numerous tools online that can help you do that. But with so many online options, knowing the best fit for your organization may be challenging. But wait! That’s where we come in. Our team at MindRind shortlisted some of the best tools to derive insights from all your data. These are AWS Cost Explorer, CloudHealth, AWS Cost and Usage Report, and AWS Application Cost Profiler.
2. Train your teams on AWS Costing
If you’ve ever had the pleasure of trying to explain the cost of Amazon Web Services to someone who doesn’t understand it, you know how important it is for everyone on your team to have a basic understanding of their costs.
Amazon Web Services is a vast and complex environment. Get your employees, including your finance teams, to attend tutorials on “Introduction to AWS Billing and Cost Management” and “Well-Architected Labs Cost Optimization.” These courses are designed for everyone on your team to understand better how AWS works and its cost model and strategies.
We know this doesn’t sound like fun. We promise it gets easier. You’re building skills to help your teams manage cloud costs. You want as many people in your team as possible to take advantage of them, including all the departments that might not traditionally have much experience with Amazon Web Services costing.
3. Plan and Calculate
We love our customers, and they love us — it’s no wonder we’re so successful.
But even the best companies have a few things that aren’t quite right, like billing, customer service, and other areas.
AWS financial models are all about building trust with your customers by making sure their experience is smooth and that you deliver the value that they expect concerning cost.
So our quick tip to you is that if you expect to be making significant cloud spending over time, you should develop forecasts even though you expect a wide margin of error early on. Trust us, that’s completely fine.
Most companies don’t have simple predictive models for their workloads’ growth. The calculations allow you to set the macro-level expectations of your cloud spending so that you know whether you’re spending less than expected or more—and how to improve your forecasting ability in the future.
Without spending the time to understand and analyze AWS costs, it’s impossible to make informed decisions about how to best use and optimize your company’s cloud resources. Spending too much on one thing might cost you more in the long run than if you had allocated your resources across all service areas.
Make sure you invest time and money in understanding your total cloud costs by looking at metrics—not just what it costs you to run but also what it costs to use.
Our last tip to you is that your Amazon Web Services account is not the only financial investment in your business. You need to consider other costs unrelated to AWS, such as infrastructure, technology, and skill required to operate an eCommerce store.
These will add up to high costs over time. To keep your bottom line healthy and profitable, make sure that you can optimize your Amazon Web Services (AWS) investments to cut down on cloud cost
Final Words from MindRind
Regarding cloud-based solutions, cost optimization is a sensitive task requiring a professional’s expertise.
Maintaining regular contact with Amazon Web Services is the most effective way to maximize cost savings. Regular monitoring and checkups are an essential part of the process that benefits everyone by reducing costs, optimizing resource utilization, and eliminating waste.
Is there any way I can avoid Amazon Web Services charges?
You can use the free tier to run your computer and run any program you want at no cost, but there are limits to that. By enabling Free Tier Usage Alerts, you get notifications of when you go over your limits.
Can I use AWS for free for a whole year?
The Amazon Web Services Free Tier offer for one year is a great way to try the power of AWS without having to pay anything. You only pay when your 12-month free usage term expires or if your application exceeds the tiers in a given year.
Can Prime members use AWS for free?
Amazon Prime members get free shipping on eligible orders from Amazon.com, so AWS Prime members get free access to Certification Lounges at AWS events—even if they’re not certified or don’t own an AWS certificate.